23 Sep 2009 13:22

EBRD to give 150-mln euro to Raiffeisen

LONDON. Sept 23 (Interfax) - The European Bank for Reconstruction and Development (EBRD) will provide 150 million euro for the development of Raiffeisen International's subsidiary banks in Ukraine, Russia and Romania.

The EBRD said on Wednesday that around 100 million euro of this amount would go to Ukrainian Raiffeisen Bank Aval. Raiffeisen International's Russian and Romanian subsidiaries will each receive 25 million euro.

The EBRD said that the funds to the Ukrainian and Russian banks would be provided in dollars.

The provision of these funds is part of coordinated assistance to Raiffeisen International from three international financial institutions - EBRD, the European Investment Bank and the World Bank. Total assistance comes to 1 billion euro.

A source in bank circles earlier told Interfax that EBRD's board of directors had approved on Tuesday the allocation of 150 million euro loan to Raiffeisen International.

Raiffeisen International is a subsidiary of Raiffeisen Zentralbank Osterreich AG, which owns 70% of its shares. Private and institutional investors own the remaining shares. In 2004, the EBRD approved a 100 million euro purchase into Raiffeisen International's capital.

Raiffeisen International manages subsidiary banks, as well as leasing and other companies in 17 Central and East European countries.

Raiffeisen International's consolidated profit in the first half of 2009 dropped by 86% year-on-year to 78 million euro since the bank decided to increase its loss reserves by 380% to 969 million euro.

Raiffeisen Bank Aval was 21st largest CIS bank and second largest Ukrainian bank by assets for 2008 according to the Interfax-1000, compiled by the Interfax Center for Economic Analysis (CEA).

Russia's Raiffeisenbank was ninth largest bank for the first half of 2009 by assets according to the Interfax-100.